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Zoom Agrees to Settle User Privacy Lawsuit for $85 Million

Zoom Video Communications has agreed to pay $85 million and improve its security practices in a proposed settlement of a user privacy lawsuit.

Zoom Video Communications  (ZM) - Get Free Report on Saturday reached a preliminary settlement on a user privacy lawsuit, agreeing to pay $85 million and improve its security and privacy practices.

The proposed settlement would resolve a class action lawsuit filed in April 2020 in the U.S. District Court for the Northern District of California alleging that Zoom violated user privacy rights by sharing personal data with Facebook  (FB) - Get Free Report, LinkedIn and Alphabet-owned Google  (GOOGL) - Get Free Report, as well as allowing the practice of Zoombombing during Zoom meetings

Zoombombing entails hackers disturbing Zoom meetings through displays of pornography, inappropriate language or other undesirable content.

The settlement requires approval from U.S. District Court Judge Lucy Koh, according to a Reuters report.

Under the settlement, subscribers would be entitled to 15% refunds on their subscriptions or $25, whichever is larger. Other people who are ineligible to submit a subscription claims would receive $15. The San Jose company also agreed to various security measures to protect users' privacy.

The videoconferencing provider had collected about $1.3 billion in subscription fees from the class action members, the report said. The plaintiff's attorneys will seek about $21 million in legal fees.

Zoom denies any wrongdoing as part of the settlement.

Zoom shares on Friday were down about 2% to $378.10 at closing

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